Asia-Pacific Crude-Libyan exports likely to weigh

SINGAPORE, April 7 (Reuters) - Differentials in the
Asia-Pacific crude market could come under pressure from an
expected increase in Libyan exports, traders said on Monday.

Libyan rebels agreed with the government on Sunday to
gradually end their eight-month petroleum blockade, which would
free four eastern oil ports to export.

The Zueitina and Hariga ports, which account for around
200,000 barrels per day (bpd) of export capacity, will open
immediately, while the larger ports, Ras Lanuf and Es Sider with
capacity of around 500,000 bpd, will be freed in two to four
weeks after more talks, the government said.

Libyan crude exports could increase by around 200,000 bpd
over the next few days and a further 550,000 bpd by early May,
JBC Energy estimated.

Storage tanks are full at the ports, and loading the crude
will be straightforward, but getting the tanks resupplied from
oilfields will take time.

While most exports of Libyan sweet crude will be sold in the
European market, some cargoes are likely to come to Asia,
traders said. Both El Sharara crude and Mellitah condensate was
shipped to Asian destinations last year.

The higher supply could also narrow Brent's premium to Dubai
crude, making it more lucrative to ship Atlantic-basin crudes to
Asia.

Brent-Dubai Exchange of Futures for Swaps (EFS)
DUB-EFS-1M, or Brent's premium to Dubai swaps, widened 2 cents
to $3.52 per barrel. Last week, the spread narrowed to $3.35,
its lowest in nearly five months.

"Differentials (...) are not likely to be swayed until the
barrels actually begin entering the market, which given Libya's
record, may be much later than announced," analysts at JBC
Energy said in a note.
Continued...